Fitch Rates CBA's Series 29 Covered Bonds 'AAA'/Stable <Origin Href="QuoteRef">CBA.AX</Origin>

(The following statement was released by the rating agency)

SYDNEY, January 20 (Fitch) Fitch Ratings has assigned Commonwealth Bank of 
Australia’s (CBA, AA-/Stable/F1+) Series 29 issue of NZD314m mortgage covered 
bonds a rating of 'AAA'. The Outlook is Stable. The fixed-rate bond is due in 
January 2021 and benefits from a 12-month extendable maturity. This issue brings 
the total covered bond issuance from the programme to AUD17.26bn.

KEY RATING DRIVERS

The rating is based on CBA's Long-Term Issuer Default Rating (IDR) of 'AA-', a 
Discontinuity Cap (D-Cap) of 2 (high) and an asset percentage (AP) of 89.5%, 
which is equivalent to Fitch's breakeven AP for a 'AAA' rating, supporting a 
'AA' rating on a probability of default (PD) basis, and a 'AAA' rating after 
giving credit for recoveries. The Outlook on the covered bonds reflects the 
Stable Outlook on CBA's IDR.

As at end-November 2013, the cover pool consisted of 121,212 loans secured by 
first-ranking mortgages of Australian residential properties with a total 
outstanding balance of AUD27.2bn, and AUD4.25bn of cash. 

Maturity mismatches are significant, with the weighted-average residual life of 
the assets at 15.4 years and of the liabilities at 5.5 years. 

RATING SENSITIVITIES

The 'AAA' rating would be vulnerable to a downgrade if the issuer's Long-Term 
IDR is downgraded by two or more notches; the D-Cap falls by more than one 
category; or the programme's AP rises above the breakeven AP of 89.5%.

Contacts:

Primary Analyst

Claire Heaton

Director 

+61 2 8256 0361

Fitch Australia Pty Ltd., Level 15, 77 King Street, Sydney NSW 2000

Secondary Analyst

James Leung

Director

+61 2 8256 0322

Committee Chairperson

Ben McCarthy

Managing Director

+61 2 8256 0388

The source of information used to assess these ratings was Commonwealth Bank of 
Australia. The issuer has informed Fitch that not all relevant underlying 
information used in the analysis of the rated bonds is public.

Applicable criteria, 'Covered Bonds Rating Criteria', dated 4 September 2013; 
'Counterparty Criteria for Structured Finance and Covered Bonds', dated 13 May 
2013; 'Counterparty Criteria for Structured Finance and Covered Bonds: 
Derivative Addendum', dated 13 May 2013 ; and 'APAC Residential Mortgage 
Criteria', dated 1 August 2013; 'APAC Residential Mortgage Criteria Addendum - 
Australia', dated 1 August 2013; 'Covered Bonds Rating Criteria - Mortgage 
Liquidity & Refinance Stress Addendum' dated 3 June 2013; 'Global Criteria for 
Lender's Mortgage Insurance in RMBS', dated 1 August 2013, are available at 
www.fitchratings.com.

Media Relations: Iselle Gonzalez, Sydney, Tel: +61 2 8256 0326, Email: 
iselle.gonzalez@fitchratings.com.

Additional information is available at www.fitchratings.com.

Applicable Criteria and Related Research: 

Covered Bonds Rating Criteria

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=717321

Covered Bonds Rating Criteria - Mortgage Liquidity and Refinance Stress Addendum

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=709665

Counterparty Criteria for Structured Finance and Covered Bonds

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=707155

Counterparty Criteria for Structured Finance and Covered Bonds: Derivative 
Addendum

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=707156

APAC Residential Mortgage Criteria - Amended

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=709855

APAC Residential Mortgage Criteria Addendum – Australia - Amended

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=710259

Global Criteria for Lenders’ Mortgage Insurance in RMBS

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=709255

Additional Disclosure 

Solicitation Status 

http://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=815830

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licence no. 337123) which authorises it to provide credit ratings to wholesale 
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